BSA/AML Student Exercises Dec. 2022

• The Trading with the Enemy Act (TWEA), targeting North Korea and Cuba; transaction control regulations can be found at 50 USC App. 1-44. • The International Emergency Economic Powers Act (IEEPA) is aimed at Libya, Iraq, Serbia, Montenegro, Bosnia, UNITA, Iran, terrorism, and narcotics; IEEPA can be found at 50 USC 1701 1706. • The Iraqi Sanctions Act (ISA) specifically targets Iraq and can be found at Pub. L. 101513, 104 Stat. 2047-55. • The United Nations Participation Act (UNPA) applies to Iraq, Libya (part), UNITA, Serbia, Montenegro, and Bosnia; the act can be found at 22 USC 287c. • The International Security and Development Cooperation Act (ISDCA) is aimed at Iran and can be found at 22 USC 2349aa-9. • The Cuban Democracy Act (CDA), 22 USC 6001-10 (relating to Cuba), has the same force of law as TWEA above. • The Cuban Liberty and Democratic Solidarity (LIBERTAD) Act, 22 USC 6021-91 (relating to Cuba), has the same fines as TWEA above and codifies the Cuban assets control regulations. • The Antiterrorism and Effective Death Penalty Act, enacting 8 USC 219, 18 USC 2332d, and 18 USC 2339b. • The Foreign Narcotics Kingpin Designation Act, Pub L. No. 106-120, tit. VIII, 113 Stat 1606, 1626 1636 (1999) will be codified at 21 USC 1901-1908. • The Criminal Code, at 18 USC 1001, provides for five years imprisonment and a $10,000 criminal fine for knowingly making false statements or falsifying or concealing material facts when dealing with OFAC in connection with matters under its jurisdiction. Currently, there are two government lists. First is the OFAC List, OFAC regulations penalize US banks for actually conducting transactions with Specially Designated National (SDNs). The second list is the list of "known or suspected terrorists or terrorist organizations" as described in Section 326 of the USA Patriot Act. A bank that fails to compare a name to a "326 list" before opening an account would be guilty of a violation of law. Currently, there are no "326 lists", available. OFAC Compliance Program, includes the following elements: Identification of High Risk Business Areas The Bank periodically conducts a risk assessment of its product lines to help identify high risk areas for OFAC transactions. Implementation and Support of Internal Controls Methods The Bank maintains proper internal controls that are further addressed in the OFAC procedures and processes which help identify suspect accounts and transactions to block and report such instances to OFAC. The objective for these internal controls is as follows: OFAC: Flagging and Review of Suspect Transactions and Accounts The Bank has implemented procedures to address the flagging and review of transactions and accounts for possible OFAC violations via FIS/OFAC Tracking SYSTEM and manual methods. These procedures allow Bank personnel to compare names provided on the OFAC list with the names in Bank data base files to help flag accounts and block transactions involving sanctioned individuals and countries. This monitoring enables Bank personnel to flag close name derivations for review and possible action, especially in high risk and high volume areas. In addition, it is the policy of the Bank to compare the names of all individuals, business entities and their principals requesting to open a new

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